- One Country, Two Societies: Rural-Urban Inequality in Contemporary China
Urban-rural inequality exists in all developing countries. However, this problem is the most acute in China due to the hu kou — literally household mouths — registration system. This system originated from the traditional Chinese custom of counting family members based on the number of mouths that need to be fed. As such, the system requires that all households report the number of their family members to the local administrators and list them in a hu kou ce (household-mouth book).
Since a person with rural hu kou registration is precluded from urban jobs, food and supply rations, housing, and education, the system exacerbates the disparity between urban and rural residents and creates three different groups of citizens: rural hu kou, rural migrants, and urban hu kou. Rural hu kou holders, confined to China’s rural areas, work as laborers with little support from the government. Rural migrants, who cannot afford to obtain urban hu kou status, thus, become so-called floating residents in Chinese urban areas, with almost none of the privileges of an urban resident. Lastly, urban hu kou holders are accorded all the aforementioned privileges.
This valuable book begins with a review of the history of the hu kou regime. Established in the 1950s by the China Communist Party (CCP), it was an effort to prevent overcrowding in urban centers and confine rural residents to jobs that aim at supporting the industrialization process in the urban areas. As a result, the new regime actually created more inequality, rather than reducing it, which was the stated objective in the propaganda of destroying the exploiting class of rich people. Since China’s economic reform was initiated in 1978, rural workers have flocked to cities and struggled through the strenuous process of applying for the urban hu kou.
Next, utilizing many advanced quantitative and qualitative research methods, the book presents evidence of discrimination on the basis of income. In the first paper, Terry Sicular, Yue Ximing, Bjorn Gustafsson, and Li Shi start with original data from China’s National Bureau of Statistics and adjust them using regional variations in the cost of living, which is often higher for urban than for rural residents. They then calculate the differences in these actual incomes among urban residents, rural migrants, and rural residents. The results show that these actual differences are smaller than the ones using the original data. In the next paper, Li Shi and Luo Chuliang also use original data from China’s National Bureau of Statistics, but adjust them by calculating the values of subsidies in-kind, such as housing, clothing, education, and amenities, received by urban residents. Not surprisingly, after making these adjustments, they find that the income gaps are widening. While these are very interesting results, the reviewer still wonders what [End Page 251] could be the ultimate result of combining these two methods in a single paper and why the authors did not use both adjustments to obtain a clear-cut conclusion, although one author, Li Shi, was a contributor to both studies.
The next few papers discuss the rural-urban inequality in terms of access to social resources. The first one focuses on access to primary and secondary education during the period of reform, 1978–2010. Using random effects regressions, Emily Hannum, Meiyan Wang, and Jennifer Adams find that the rural pupils suffer significant disadvantages in education. The only regrettable shortcoming of this paper is that the authors could have performed and reported Hauman test results to convince the readers that their random effects estimation approach is more suitable than a fixed effects approach.
The second paper, by Winnie Yip, zeros in on health care and points out that the market reform during the 1978–2003 period deprived rural residents of an almost universal health care system. Since 2004, the cooperative health care system has been rebuilt, and the author looks forward to a brighter future for the health...